Senate Bid to Renew Jobless Benefits Collapses as Parties Spar

Jan. 15 (Bloomberg) -- Senators retreated to their partisan corners after the chamber failed to advance a Democratic plan to restore emergency jobless benefits that expired Dec. 28 for 1.3 million Americans.

With no solution in sight, Democrats accused Republicans of ignoring the plight of the long-term unemployed, while Republicans said Democrats weren’t working in good faith to strike a compromise.

“Is this about a sound bite, or is this about actually extending unemployment benefits?” North Dakota Senator John Hoeven, part of a group of Republicans who had been negotiating with Democrats, said after yesterday’s 55-45 vote.

The Senate is turning its attention this week to bills funding the government before leaving town for a week and has no plans to return to the jobless benefits issue. Even so, Charles Schumer of New York, the No. 3 Senate Democrat, voiced optimism that a solution could be found within a month.

A dispute over how to cover the cost of the benefits and how long they should continue -- for three months or almost a year -- stalled the measure last week. Sixty votes were needed yesterday to advance the legislation and just one Republican -- Nevada’s Dean Heller -- joined with Democrats to back the measure. Democrats control 55 seats in the 100-member chamber.

“Our Republican colleagues don’t seem to get it: The world is changing,” Schumer said. “And they’re just missing the call.”

‘Fundamentally Unfair’

Shortly before yesterday’s vote, Majority Leader Harry Reid, a Nevada Democrat, offered Republicans a chance to propose amendments. Republican Leader Mitch McConnell rejected Reid’s offer, saying it was “fundamentally unfair” because it required 60 votes for his party’s proposals to prevail. Final passage of the bill, though, would require only 51 votes.

The expanded program started in 2008, when the U.S. unemployment rate was 5.6 percent, and at one point provided as many as 99 weeks of benefits for the long-term unemployed. At the end of 2013 the maximum was 73 weeks, including 26 weeks of state-funded benefits. The national jobless rate in November was 7 percent.

Democrats had proposed a three-month extension of the jobless benefits, costing $6.4 billion, as emergency aid without offsetting the cost.

Six Republicans joined Democrats to keep the bill alive in a procedural vote Jan. 7. All six insisted on adding language to pay for the expanded benefits with budgetary reductions elsewhere.

Thread Needle

Reid said last week he would be open to covering the cost of the unemployment benefits measure only if the extension ran for almost a year instead of three months.

“Everyone has worked very hard to work through this process, to try to thread the needle,” Reid said on the Senate floor yesterday.

Hoeven and other Republicans, including Heller, Ohio Senator Rob Portman and Maine Senator Susan Collins, yesterday proposed to Reid a plan to extend the jobless benefits for three months with the cost fully covered.

“The disagreement is Republicans want to be able to vote on amendments,” which Reid wouldn’t allow, Hoeven said at a Bloomberg Government breakfast. Hoeven said he hoped the Republicans’ “good-faith offer” would move the talks forward.

Negotiations imploded Jan. 9 when Reid proposed renewing the benefits through mid-November and covering the cost in part by adding a year to automatic federal spending cuts. Republicans called that a budget gimmick and complained that they weren’t being given a chance to offer amendments.

Minimum Wage

White House Press Secretary Jay Carney expressed disappointment that the Senate failed to advance the Democrats’ proposal and said it would would with lawmakers from both parties to find a solution.

“Extending emergency unemployment insurance is the right thing to do for these Americans and their families, and it’s the right thing to do for our economy,” Carney said in an e-mailed statement.

As part of their focus on income inequality, Democrats in the coming weeks will seek to raise the federal minimum wage and increase spending on infrastructure projects to create jobs.

House Speaker John Boehner, an Ohio Republican, said his chamber will consider extended jobless benefits only if the cost is covered and if the measure includes job-creation provisions.

The emergency benefits have been renewed 11 times since President George W. Bush put them in place. All extended benefits are covered by federal dollars, while initial jobless insurance comes from federal, state and employer funds.